Correlation Between Enduro Metals and Guru Organic

Can any of the company-specific risk be diversified away by investing in both Enduro Metals and Guru Organic at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Enduro Metals and Guru Organic into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Enduro Metals Corp and Guru Organic Energy, you can compare the effects of market volatilities on Enduro Metals and Guru Organic and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Enduro Metals with a short position of Guru Organic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enduro Metals and Guru Organic.

Diversification Opportunities for Enduro Metals and Guru Organic

-0.36

Correlation Coefficient

Enduro Metals  Guru Organic

Very good diversification

The 3 months correlation between Enduro and Guru is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Enduro Metals Corp and Guru Organic Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guru Organic Energy and Enduro Metals is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Enduro Metals Corp are associated (or correlated) with Guru Organic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guru Organic Energy has no effect on the direction of Enduro Metals i.e., Enduro Metals and Guru Organic go up and down completely randomly.

Pair Corralation between Enduro Metals and Guru Organic

Assuming the 90 days trading horizon Enduro Metals is expected to generate 3.37 times less return on investment than Guru Organic. In addition to that, Enduro Metals is 1.31 times more volatile than Guru Organic Energy. It trades about 0.03 of its total potential returns per unit of risk. Guru Organic Energy is currently generating about 0.12 per unit of volatility. If you would invest  137.00  in Guru Organic Energy on December 29, 2024 and sell it today you would earn a total of  44.00  from holding Guru Organic Energy or generate 32.12% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Enduro Metals Corp  vs.  Guru Organic Energy

Enduro Metals Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Enduro Metals Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal fundamental indicators, Enduro Metals may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Guru Organic Energy

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Guru Organic Energy are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Guru Organic displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Enduro Metals and Guru Organic

The main advantage of trading using opposite Enduro Metals and Guru Organic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enduro Metals position performs unexpectedly, Guru Organic can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Guru Organic will offset losses from the drop in Guru Organic's long position.

The idea behind Enduro Metals Corp and Guru Organic Energy pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.